Chevron takes shakedown lawyers to court in RICO trial

posted at 2:31 pm on October 19, 2013 by Jazz Shaw

We’ve spent plenty of time and column space here over the last couple years keeping you up to date on the the attempts of various corrupt Ecuador agencies and their Eco-warrior counterparts in the United States to sue Chevron over claimed damages in Ecuador’s oil fields. While such tactics have traditionally been successful against big corporations with deep pockets, choosing to simply pay off the pests rather than spending the time and money to fight them, not so with Chevron. The plaintiffs, led in large part by Manhattan lawyer Steven Donziger, tried to dig too deep, racking up a $19B judgement in an Ecuador court based on what turned out to be a staggering series of apparently fraudulent ploys. Chevron fought back and refused to cough up a dime.

Chevron alleges in the non-jury trial before U.S. District Judge Lewis Kaplan that a Manhattan lawyer, Steven Donziger, and others involved in the pollution case engaged in a “racketeering enterprise” and won the 2011 verdict through coercion, manufactured evidence and bribery of the Ecuadorean judge who wrote it. The company is seeking a ruling preventing the plaintiffs from trying to enforce the verdict in courts around the world. Burford reached an agreement with Chevron to provide testimony after being described in the lawsuit as a party involved in the scheme, Bogart said yesterday.

Donziger contends he did nothing unlawful in Ecuador and that Chevron engaged in similar tactics. Kaplan said in a ruling last week there’s “considerable evidence” the pollution case was “tainted by fraud.”

In a portion of testimony filed with the judge, Bogart said “we simply do not countenance in any way the kind of behavior this court has already found has occurred” and “we never would have invested” in the case if they were aware of the allegedly fraudulent activities.

This should be interesting to watch and we’ll definitely keep an eye on it. I don’t recall another case of this size where the person trying to pick the big company’s pockets wound up in front of a judge being brought to task for their actions. Donziger’s defense thus far seems to be, “Hey, everybody does it.” I’m not sure how well that’s going to wash here.

The judge is already getting an earful in the opening days of the trial.

A former expert for the plaintiffs, David Russell, testified yesterday that he provided a $6.114 billion damages estimate based “largely on assumptions Donziger told me to use.”

“Within a year of working for Donziger, I came to learn that my cost estimate was wildly inaccurate and had no scientific data to back it up,” he said in written testimony submitted to the judge.

After drawing up his observations in the Hotel Lago, he arrived at a cost-estimate of more than $6 billion. He called the figure Wednesday a S.W.A.G., or a “Scientific Wild Ass Guess.” Two years after his falling out with Steven Donziger, who was then the lead attorney on the lawsuit representing residents of the Ecuadorean rainforest, Russell quit the case and publicly disavowed the estimate.

“While I was working on the estimate in the Hotel Lago, Donziger told me that he wanted a ‘really big number,’ and he needed a ‘really big number’ for purposes of ‘putting pressure’ on Chevron to settle the litigation,” the deposition states. “In response, I told him that I would try to come up with the biggest possible cost estimate I could.”

As we’ve detailed here in the past, Chevron has a lot more to unleash in front of the judge. Fraud, abuse, threats to court officials in Ecuador and people who have come clean and admitted that they flat out lied about what went on down there in the jungle. What must have looked to Donziger like the score of a lifetime may be turning into a nightmare. Of course, this isn’t a criminal trial – yet – and will only result in a judgement preventing the plaintiffs from profiting from this attack. Could it lead to more serious charges later? I’ll have to ask some lawyers about that one. Stay tuned.

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Too bad that this is an outlier, and not the normal way oil companies do business. If more would fight back against the illegal, immoral, and underhanded practices of the left, the country would be in a better place.

Across a table in his two-bedroom apartment on the Upper West Side of Manhattan, Mr. Donziger for the first time in recent years spoke publicly about the personal travails that he says have engulfed him. He says shadowy men have trailed him. Watched his family. Sat in cars outside his home. He had his apartment swept for bugs, but found nothing.

All of that might sound like the ravings of a Grade A conspiracy theorist. But Mr. Donziger, who played basketball with Barack Obama at Harvard Law School, has a serious following among environmentalists. He and his supporters say he is being vilified — potentially ruined — for unmasking Chevron’s questionable environmental record. Chevron, which is suing him and his associates for damages that could reach billions of dollars, says he is simply a con artist.

It is a remarkable turn of events for Mr. Donziger, who has chased after Chevron with the single-mindedness of Ahab. Reports of questionable ethical conduct have cast doubt over his motives. He is accused of engineering the ghostwriting of a crucial report submitted to the Ecuadorean court that decided the case, a claim he says is exaggerated and misconstrues local legal customs. Some of his former allies have abandoned him and signed statements taking Chevron’s side.

In this case Chevron is probably right; however, Chevron has a reputation to fight every battle and wear the opposition down. No matter how guilty Chevron is, they won’t settle. They use some pretty shady tactics that are rather unethical. When I worked for a Geo-Chem company doing environmental work, I did a lot of work in support of litigation against Chevron. I personally won’t buy anything from them because of their lack of ethics.

While such tactics have traditionally been successful against big corporations with deep pockets, choosing to simply pay off the pests rather than spending the time and money to fight them, not so with Chevron.

also

will only result in a judgement preventing the plaintiffs from profiting from this attack.

Of course, this isn’t a criminal trial – yet – and will only result in a judgement preventing the plaintiffs from profiting from this attack. Could it lead to more serious charges later? I’ll have to ask some lawyers about that one. Stay tuned.

I’ve been watching this since before Jazz started his solid coverage. Donziger is a thief and should be disbarred and jailed. Let’s all hope for the sake of our legal system that a groundbreaking case emerges which puts scum like Donziger and his fellow traveler John Edwards on notice that their criminal behavior is not protected by our courts.

They may be correct to fight the trivial claims of politcically-motivated and corrupt environmentalists. That’s good.

That this is even necessary is because at the boardroom level Chevron, and other large companies, they pander to the political environmentalists that they are fighting in the courtroom trenches.

Every stupid TV ad from corporations that claims they are “working to save the planet” is an open invitation for a 100 cockroaches like Donziger to feast.

Why don’t CEOs understand the political connection of their marketing persona to their actual engagement on the ground? They would have a lot less trouble in the courts if they spent a bit of effort educating the public on the environmental facts of the matter, rather than pandering to the liberal media at every turn.